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Last Updated:  Tuesday, 18 March, 2003, 17:22 GMT
BAE Systems cuts 1,000 jobs
Maintenance work on a Nimrod
The Nimrod contract has been problematic
BAE Systems, the UK defence giant, has said it is cutting 1,005 jobs.

The losses have been blamed on the downturn in the civil aviation market and problems with a Ministry of Defence contract to supply Nimrod maritime patrol aircraft.

Last year the company admitted to difficulties with the contract, saying there would be delays and cost overruns.

Nearly half of the job losses will be at Woodford in Cheshire, while the remaining cuts will be split between BAE's plants at Chadderton, near Manchester, Prestwick in Ayrshire, and Warton in Lancashire.

Production problems

BAE Systems has come under pressure in recent months following a number of difficulties with its Ministry of Defence contracts.

Its share price plunged in December after it warned of possible cost overruns and delays on contracts to supply three Astute class submarines and 18 Nimrod aircraft.

Last month BAE Systems agreed with the MoD to alter the contract terms which drew a line under potential losses, but the deal cost it 750m.

The Nimrod contract relates to the rebuilding of 18 aircraft.

Under the new terms, work on three aircraft will be completed in order to calculate the full cost of redesigning each plane.

Production work on the remaining 15 planes will be halted until the cost is uncovered, which should give greater certainty to the cost of the whole project.

BAE Systems said last month that these changes would lead to job losses, although at the time it did not know the full impact on its workforce.

It said it was now talking to worker representatives to try to "mitigate" the job losses.

Skills lost 'might never return'

Most of the cuts are expected to have taken place by the end of this year.

"We are disappointed at the scale of the cutback," said John Wall, national officer at the Amicus union.

"We have concerns over the future strategic capability of the UK aerospace industry due to the highly skilled nature of the job losses announced.

"The workers at BAE are highly skilled and marketable and we are worried that once these skills are lost, they will never return to the UK industry."

BAE Systems shares closed at 129.75 pence, down 0.25p.

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